Insights

BlackRock is leading a major push to tokenize real-world assets (RWAs), with ambitions to digitize up to $10 trillion of its portfolio over the coming years. This effort represents a significant evolution in asset management, where traditional financial instruments such as bonds, real estate, and short-term treasury assets are converted into digital tokens on blockchain networks. CEO Larry Fink has openly backed tokenization, pushing for regulatory clarity and encouraging broader institutional participation.

BlackRock plans to launch tokenized versions of exchange-traded funds and build out the technology to support the digitization of traditional assets, according to Chair and CEO Larry Fink’s comments during the firm’s earnings call Oct. 14.

According to a Bloomberg report, the New York-based firm is weighing how to tokenize exchange-traded funds (ETFs) tied to real-world assets such as stocks, subject to regulatory considerations. Tokenization involves creating blockchain-based versions of traditional financial assets. In the case of ETFs, digitization could facilitate trading outside Wall Street’s usual hours, allow easier international access, and create new possibilities for using shares as collateral within crypto networks.

Advocates argue that tokenization can deliver instant settlement, fractional ownership, and more efficient market structures. The concept is beginning to gain momentum across the financial industry. Asset managers, including Franklin Templeton, have already issued tokenized share classes of money-market funds. BlackRock has consistently positioned itself as an early mover in this space. Chief Executive Officer Larry Fink has repeatedly said he believes every financial asset can ultimately be tokenized. In his 2025 annual letter to investors, Fink reiterated that tokenization has the potential to transform financial markets.

Demand appears to be building on the buy side. A State Street survey found that most institutional investors expect their digital-asset exposure to double within three years, with more than half anticipating that 10%–24% of their portfolios will be tokenized by 2030. Robinhood’s CEO has likewise predicted that most major markets will have a tokenization framework by 2030.

Rather than disrupting traditional finance through confrontation, tokenization is being absorbed and deployed by incumbents themselves. When MUFG tokenizes a $681 million building, when Goldman creates blockchain-based money market funds, when BlackRock engineers MakerDAO’s Treasury investments, they’ve acknowledged something that has been hiding in plain sight.

The current system, with its settlement delays, access restrictions, and operational friction, has become competitively disadvantaged. Every asset that remains exclusively offchain becomes less liquid, less accessible, and more expensive to trade relative to tokenized alternatives. Financial institutions that resist tokenization risk watching their assets and services become obsolete. Stocks, bonds, and real estate were just the beginning. Even more interesting use cases will be happening at the edges – as more variety of assets is brought into the onchain world.

In an interview at Singapore’s Token2049 conference, Robinhood CEO Vlad Tenev described the tokenization of assets—such as stocks and real estate—as a “freight train” that will fundamentally transform (“eat”) the financial sector. Tenev argued that linking real-world assets to blockchains will make trading them far easier and vastly expand financial markets: moving the addressable market from just a few trillion dollars to potentially tens of trillions. He emphasized that tokenization represents a massive, inevitable shift for the industry, poised to rewire the traditional approach to securities and asset trading.

“While we’ll start with crypto token sales via Sonar, we plan to expand support to tokenized securities and real-world assets over time.”

Beyond Bitcoin and Ethereum, some of the most noteworthy developments in digital assets are happening in stablecoins and tokenized real-world assets (RWAs). These innovations bridge the gap between the digital assets’ ecosystem and traditional finance, providing functional utility today and reshaping how value is transferred globally. The tokenization trend extends beyond dollars to a wide range of real-world assets. Over the past year, tokenized treasury bills have seen rapid growth, offering investors yield on short-term government debt without leaving the blockchain environment. The market has also begun to see the emergence of tokenized equities, which enhance accessibility, efficiency, and expand trading hours for highly traded stocks.

Perhaps the most transformative opportunity lies in tokenizing historically illiquid assets such as real estate, commodities, and private assets. Many of these asset classes have traditionally only been accessible to institutional investors and some high-net-worth investors, including hedge funds and private credit markets.

The rationale for this potential growth opportunity is simple: Tokenization has the potential to make traditionally illiquid or exclusive assets more accessible and tradeable. It is important to note that each specific asset group has its own nuance for why it may or may not benefit from upgraded network rails and to what degree. There has already been substantial growth in areas where the benefits to institutional investors are more pronounced—such as private credit—whereas experimentation continues in nearly all the assets listed above. However, the Fidelity Digital Assets Research team believes the question is no longer whether digital assets matter. For institutional investors seeking to manage risk and capture potential opportunity, the defining question of the next decade may instead be: What role should digital assets play in my portfolio?

McKinsey forecasts total tokenized market capitalization reaching $2 trillion by 2030 (excluding cryptocurrencies and stablecoins), driven by adoption in mutual funds, bonds, ETNs, loans, and alternative funds. In a bullish scenario, value could double to $4 trillion.

Analysts expect this sector to grow to a minimum $2 trillion, potentially up to $30 trillion over five years, as traditional financial institutions like BlackRock and Franklin Templeton ramp up tokenization of government securities and other assets.